4th Aug 2026 09:31
(Alliance News) - BP PLC on Tuesday said it needs to "get fit to grow," as it announced plans to sell its US biogas business alongside better-than-expected second quarter earnings.
Underlying replacement profit before interest and tax soared to USD10.31 billion in the quarter ended June 30 from USD5.25 billion the year prior, ahead of the company-compiled consensus of USD9.48 billion.
Underlying RC profit attributable more than doubled to USD5.73 billion from USD2.35 billion, ahead of the USD5.11 billion consensus, as the firm benefited from higher oil prices.
A dividend of 8.32 US cents was declared, compared with 8.00c the year prior.
Net debt fell to USD22.25 billion from USD26.04 billion a year ago, and operating cash flow improved to USD10.86 billion from USD6.27 billion on-year.
Shares in BP rose 0.9% to 557.30 pence each in London on Tuesday morning.
New Chief Executive Meg O'Neill called it a "strong quarter", but said there were areas "where our performance fell short."
O'Neill, who joined BP in April from Woodside Energy, said operationally, plants didn't run as well as they did in the prior quarter, production was down, and refineries processed less crude.
"This was due, in part, to planned maintenance and the conflict in the Middle East, but this is a reminder that we have more to do to deliver consistent operational performance," she said.
Upstream production edged down to 2,201 million barrels of oil equivalent per day in the quarter from 2,339 mboe/d the year prior. It is forecast to be 2,100 to 2,250 mboe/d in the third quarter, including the impact of continued disruption in the Middle East.
O'Neill said BP has made "good progress" strengthening its balance sheet, noting the sale of its Gelsenkirchen refinery and the retail business in Austria, plus the intention to sell its North Sea business in the UK.
On Tuesday, BP said it was looking to offload Archaea, its biogas business in the US, which it bought back in 2022 for USD3.3 billion.
Strengthening the balance sheet was one of five priorities O'Neill laid out to "deliver a step change in performance."
"We need to take a clear look at ourselves: assessing what needs to change, stopping what holds us back and building strength where it matters. We have to get fit to grow," the CEO pledged.
She said BP needs to simplify the portfolio based "on value, not sentiment nor history," invest with greater discipline, drive operational excellence and hardwire high-performance and accountability into the business.
"We will be transparent about how we progress - and judge ourselves by our results. I want the organisation focused on execution: deliver what we said, faster and with greater intensity. In three words: focus, perform, grow," the CEO said.
Looking ahead to the third quarter, BP expects a significantly lower result in its customers business, compared to the second quarter, with broadly flat volumes and a lower midstream result, as well as lower earnings in Castrol due to the lagged impact of higher base oil costs. Both fuels margins and midstream performance are expected to remain sensitive to conditions and developments in the Middle East.
In products, BP expects throughput of 1,300 to 1,360mb/d, reflecting the completion of the Gelsenkirchen sale and a lower level of planned turnaround activity. Refining margins are expected to remain elevated and sensitive to the cost of supply and market conditions.
By Jeremy Cutler, Alliance News reporter
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